Understanding How Property Tax Is Collected

Regional and local governments all over the country collect property taxes. Understanding how property tax is collected is mainly down to knowing what you have to pay, how you have to pay it, and why you have to pay. In terms of why, it is because these taxes pay for the public services that all property owners can use. These include things, such as museums, parks and recreational facilities, public hospitals, schools, emergency services, maintenance, roads, and utilities. Each local area has its own government entity to collect property taxes, so you should start by looking that up.

Understanding How Property Tax Is Collected – Jurisdiction

A state constitution or other similar legal document that the state government has passed, ensures that the government has the authority to collect property taxes. If you are unsure about this, you could request a copy of your state constitution, which will highlight all the different types of taxes, as well as their rates, in your area. Furthermore, good constitutions will also tell you how the money that is collected is distributed so that you know how much out of every dollar you pay will go to what kind of program.

Understanding How Property Tax Is Collected – Value

Usually, your local city or county government will collect property taxes and pass them on to the state government. The calculation is ad valorem, which means you pay a percentage of the value of your home. Real property (buildings and land) can be taxed as such, but so can other forms of tangible personal property (private jets and boats). The local government collects all this revenue and that is then sent on to the state, where the different government branches, as highlighted in the state constitution, receive their shares.

Understanding How Property Tax Is Collected – Authority

In this country, each state decides for itself how much authority a local government has in terms of assessing the property taxes within the area. The International Handbook of Land and Property Taxation even states that just how much control a local government has over property taxes gives a clear indication about how good they are at making other autonomous decisions in terms of their expenditure. It is not unheard of, for instance, for a local government to have its own tax districts, which have limited purposes. For instance, the local government may want to fund a public hospital.

Understanding How Property Tax Is Collected – Your Role as a Citizen

If you own property, you will have to pay property taxes on that, which is sent to your local tax collector. There are likely to be several offices in your city or county where payments can be made, and many now even offer online payments. You also have the opportunity to decide who will be a tax collector in your locality by voting in the elections. These individuals have to follow certain laws, but they can effectively be any individual that the public wants to have responsibility over the collection and administration of all the different property taxes.